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DOI: https://doi.org/10.33258/birci.v5i3.6187
The Effect of Work from Home and Followership Style on
Employee Performance Mediating by Work Motivation (A Case Study of PT. Sampang PSC at Post Acquisition)
Fidelis Gultom1, Albert Wanasida2
1,2Faculty of Management, Universitas Pelita Harapan, Jakarta, Indonesia [email protected]
I. Introduction
The term "merger and acquisition," abbreviated "M&A," has come to be acknowledged as a frequent and strategic technique in business all over the globe for the purpose of enhancing a company's dominating position in the market.
According to the "Komisi Pengawas Persaingan Usaha (KPPU)," in 2018, there were fifty mergers and acquisitions that took place in Indonesia. These deals had a total asset value of more than IDR 2.5 trillion, and their combined turnover was larger than IDR 5 trillion (Fitriani, 2018).
The previous research team had been looking at M&A from a wide range of angles, and they had been examining and analysing it. The vast majority of studies have been undertaken to evaluate M&A's financial status, and very few studies have connected M&A to human resources or human perspectives of day-to-day life. One of the few studies that looked at the success of mergers and acquisitions from the viewpoint of human capital was conducted by Mirc (2013). This study also identified human resources as an independent variable that impacts the performance of mergers and acquisitions. On the other hand, this research does not analyse how the M&A policies and the integration process affect the performance of employees.
The purpose of this study is to evaluate acquisition in connection to human resources, more especially on employee performance, and PT. Sampang PSC will serve as
Abstract
After PT. Ophir acquired by PT. Sampang PSC, the PT. Ophir’s employee performance for the most part (67%) was stable/neutral, 18% shown a decrease performance and only 15% of employees have a better performance. Starting from this background, the purpose of this study is to examine the direct effect of Work from Home (WFH) and Followership Style (FS) on Employee Performance (EP), as well as the indirect effect through Work Motivation (WM) as a mediator. The research population is PT.
Sampang PSC employees who came from PT. Ophir. The number of samples using the Slovin formula which is 142 employees. The sampling method uses purposive sampling and incidental sampling. The data analysis technique used PLS-SEM by selecting SmartPLS 3.0 as software. The study result shows that WFH has a positive but not statistically significant effect on EP. WFH has an unfavourable and insignificant effect on WM. FS has a positive and significant effect on WM. FS has a positive and significant effect on EP. WM has a positive and significant effect on EP. WM plays a role as a full mediator variable to increase the effect of WFH on EP. WM does not act as a mediator on the effect of WFH on EP, and the effect of FS on EP.
Keywords
work from home; followership style; work motivation;
employee performance.
Budapest International Research and Critics Institute-Journal (BIRCI-Journal) Volume 5, No 3, August 2022, Page: 21731-21743 e-ISSN: 2615-3076 (Online), p-ISSN: 2615-1715 (Print)
www.bircu-journal.com/index.php/birci email: [email protected]
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the research object for this investigation. There was a firm known as PT. Ophir in the past, and in 2019, that business was purchased by PT. Sampang PSC. All of PT. Ophir's workers have been brought over to PT. Sampang PSC. The record of employee performance at PT.
Ophir that was provided by the HR department indicates that, on average, employees are doing very well in their jobs. After the first two years after the purchase, it is necessary to conduct an employee performance review of PT. Ophir, taking into account any changes in conditions such as the organization of the firm, its leadership, the working environment, or its business processes. In addition, during the process of integration, early in the year 2020, PT. Sampang PSC introduced a new policy that allowed all workers to work from home due to the effect of the pandemic. COVID-19. The outbreak of this virus has an impact of a nation and Globally (Ningrum et al, 2020). The presence of Covid-19 as a pandemic certainly has an economic, social and psychological impact on society (Saleh and Mujahiddin, 2020). Covid 19 pandemic caused all efforts not to be as maximal as expected (Sihombing and Nasib, 2020). Because of the new manner of doing things at PT. Ophir, employees will only interact with their supervisors and co-workers through online meetings, and they will also be required to participate in the integration process over the internet.
In response to the formal request made by the researcher, the Human Resources Department (HRD) of PT. Sampang PSC gave data on the employee performance assessment of PT. Ophir without providing names or positions. As can be seen in Table 1, HRD maintains records of these 182 workers' performance throughout the course of the last five years (2017-2021).
Table 1. Performance Appraisal of Former PT Ophir Employees Performance Level Number of employees
(persons)
Percentage
Performance increase 27 15%
Performance stable 122 67%
Performance decrease 33 18%
Total 182 100%
Source: HR Department PT Sampang PSC (2022)
According to Table 1, staff performance appraisals in the previous five years (2017- 2021) have been performance increase, performance constant, and decrease. Most former PT Ophir employee working for PT Sampang PSC (67%) had a consistent performance;
however, only 15% of workers are doing performance increase while 18% are performing decrease.
HR Department categorizes employee performance into five levels, 1 = unacceptable/unsatisfactory, 2 = need improvement, 3 = good, 4 = superior/exceed expectation, and 5 = excellent. Given that the five performance levels will be averaged, there will be numbers after the comma, class intervals must be calculated using the formula I=R/K (where: I=Class Interval, K=number of classes, and R= Maximum value - minimum value) (Riana, 2012), so the class interval is I = R/K to I = 4/5 = 0.80. The rating become (i) Unsatisfactory is 1 x 1.80 based on the 0.8 class interval. (ii) Need Improvement = 1.80 x 2.60, (iii) Good = 2.60 x 3.40, (iv) Superior/Exceed Expectation = 3.40 X 4.20; (v) Excellent 4.20 X 5.00
Table 2 displays employee performance over the previous five years based on these rating factors.
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Table 2. Average Value of Employee Performance (2017-2021)
Year Mean Category
2017 2.76 Good
2018 3.18 Good
2019 3.25 Good
2020 3.15 Good
2021 3.13 Good
Average in 2017-2021 3.09 Good
Source: Reprocessed from HRD PT. Sampang PSC (2022)
Table 2 shows that the average performance of the 182 employees over the last five years (2017-2021) has been good. It means that their performance is not even close to being superior/exceeding or even to excellent. It means that from the perspective of employee performance measurement, both Table 2 and Table 1 show that there are still empirical problems or phenomenon gaps in the performance of former PT. Ophir employees who are now working under the auspices of PT. Sampang PSC. This research will be studying correlation of Work from Home and Followership Style as independent variable to Employee Performance as dependent variable and how these both independent variable mediating by Work Motivation correlation to Employee Performance.
1.1 Hypothesis Development
In light of the fact that the performance of PT. Sampang PSC's employees has not yet met the superior/exceed level or even the excellent level, it is essential to look for variables that influence employee performance in order to find a solution that will improve employee performance in the future. PT Sampang PSC’s employees have not yet met the superior/exceed level. Previous studies have revealed that a number of different factors may impact employee performance, which paved the way for the development of study hypotheses.
II. Research Method
2.1 Object of Research
This research aims to investigate the direct effect of Work from Home (X1) and Followership Style (X2) on Employee Performance (Y), as well as the indirect effect of Work from Home (X1) and Followership Style (X2) on Employee Performance (M). As a result, the research object consists of four research variables: two independent variables (Work from Home, Followership Style), one mediator variable (Work Motivation), and one dependent variable (Employee Performance).
2.2 Research Type
The quantitative approach is used in this investigation (Creswell & Creswell, 2018).
This research, on the other hand, is a survey, so we can differentiate it from experimental investigations (Cooper & Schindler, 2014: 238). From all the available research design alternatives, a causal explanatory design was selected for this investigation (reporting study, descriptive causal, and causal study consisting of explanatory causality and predictive causality). Studies that investigate the ways in which one concept may anticipate changes in another construct are known as explanation causal studies (Cooper & Schindler, 2014). The study of causal interactions may be broken down into two categories:
symmetrical relationships and asymmetrical relationships. Symmetrical ties are beyond the
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scope of this particular investigation. Because the asymmetric relationship only has an effect in one direction, namely the influence of the independent construct on the bound construct, the arrow can only point in one direction, namely from the independent variable to the dependent variable. In other words, the arrow is pointing from the independent construct to the bound construct. This indicates that the dynamics of one construct, referred to as free constructions, impact the dynamics of another construct, referred to as bound constructs (Cooper & Schindler, 2014: 138).
III. Result and Discussion
3.1 Results
The reliability indicator test evaluates an indicator's validity. The outer loading is used to calculate the reliability indicator. A reliable indicator has a loading factor greater than 0.708 for the intended construct (Hair et al, 2016; Widarjono, 2015; Haryono, 2017).
The test procedure begins with 1st Run, followed by 2nd Run to eliminate the minus number loading factor, and finally 3rd Run to eliminate the loading factor of 0.708 or less.
Table 3 and Figure 1 show the result, which 20 indicators passed the reliability test from the initial (1st Run) 86 indicators.
Table 3. Outer Loading on Final (Third) Run
Employee
Performance
Followership Style
Work From Home
Work Motivation
EP1 0,800
EP12 0,805
EP15 0,790
EP5 0,773
FS12 0,810
FS3 0,830
FS5 0,781
FS6 0,718
FS7 0,736
FS9 0,779
WFH1 0,801
WFH16 0,725
WFH17 0,742
WFH2 0,837
WFH6 0,831
WFH7 0,817
WM13 0,702
WM14 0,906
WM15 0,917
WM16 0,741
Source: PLS-SEM Research Data Processing Results (2022)
Figure 1 below shows the final model of this research from the remaining 20 indicators. The 20 indicators consist of six Work from Home indicators (WFH1, WFH2, WFH6, WFH7, WFH16, and WFH17), six Followership Style indicators (FS3, FS5, FS6, FS7, FS9, and FS12), four Work Motivation indicators (WM13, WM14, WM15, WM16)
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and four Employee Performance indicators (EP1, EP5, EP12, EP15). Based on this, it can be concluded that all 20 indicators in this study are reliable to measure the construct.
Figure 1. Final Model
A discriminant validity test is carried out using Fornell-Larcker, namely the comparison value between the Average Variance Extracted (AVE) value with the correlation value quadrant between the constructs or comparing the AVE root with the correlation value quadrant between the constructs as shown in Table 4 Fornell-Lacker each latent variable must greater than the correlation between latent variables.
Table 4. Discriminant Validity Results with Fornell-Larcker
Employee
Performance
Followership Style
Work From Home
Work Motivation Employee
Performance 0,792
Followership Style 0,729 0,777
Work From Home 0,283 0,266 0,794
Work Motivation 0,538 0,452 0,117 0,822
Source: PLS-SEM Research Data Processing Results (2022)
The results presented in Table 4 demonstrate that the Fornell-Lacker value (0.792) is greater than the correlation between Employee Performance and Followership Style (0.729), greater than the correlation between Employee Performance and Work From Home (0.283), and greater than Employee Performance on Work Motivation (0.538). This was also proved with regards to the Fornell-Larcker variables of Followership Style, Work From Home, and Work Motivation.
Additionally, an examination of the internal consistency test is carried out, with the help of composite reliability indicators and Cronbach's alpha. 0.7 is the minimum figure that is generally considered acceptable for the composite reliability and the Cronbach's Alpha level (Hair et al., 2014; Widarjono, 2015; Haryono, 2017; Ghozali, 2012).
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Table 5. Construct Reliability and Validity
Source: PLS-SEM Research Data Processing Results (2022)
The results of the tests of internal consistency are shown in Table 5, where composite reliability and Cronbach's alpha were used. Each of the four research variables has a Cronbach's alpha value that is more than 0.60, and the four research variables have a composite reliability value of 0.60. As a direct consequence of this, the internal consistency test was successfully completed with all four variables.
The results of the convergent validity test are also included in Table 5. This test determines the level of accuracy of the indicators that are used to measure the construct or dimension by calculating the magnitude of the correlation that exists between the construct and the latent variable. The results of this test are included in Table 5. Farnel (Kurniawan
& Yamin, 2011) and Widarjono (2015: 278) advocate using AVE as a criteria for assessing convergent validity for determining convergent validity. According to Table 5, all four of the study variables—Employee Performance, Followership Style, Work from Home, and Work Motivation—have AVE values that are more than 0.50, which indicates that the convergent validity test was successfully completed with all four of the variables.
The factors included in the study are shown to have a direct association in Table 6.
The findings from five different connection models indicate that WFH has a coefficient of effect on EP that is 0.096. (9.6 percent). The coefficient of effect of WFH on WM is - 0.003, and it is negative (-0.3 percent). The influence of FS on WM is represented by a coefficient of 0.453. (45.3 percent). The influence of FS on EP is represented by a coefficient that has a value of 0.585. (58.5 percent). There is a correlation between WM and employee performance, with a coefficient value of 0.263. (26.3 percent). Within the group of five relationship models, there are four good relationship models and one negative relationship model.
Table 6. Correlation between Each Variable
Employee
Performance
Work Motivation Employee Performance
Followership Style 0,585 0,453
Work From Home 0,096 -0,003
Work Motivation 0,263
Source: PLS-SEM Research Data Processing Results (2022)
Calculations for the sixth and seventh relationship models that incorporate mediator variables are shown in Table 7, which may be seen below. Based on the calculation of the Variance Accounted Factor (VAF), which is the direct effect value divided by the total effect and multiplied by 100 percent, it has been demonstrated that WM plays a partially
Cronbach’s Alpha
Composite Reliability
Average Variance Extracted (AVE)
Employee Performance 0.802 0.871 0.627
Followership Style 0.868 0.901 0.603
Work From Home 0.888 0.910 0.630
Work Motivation 0.842 0.892 0.676
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mediating role for the effect that WFH has on EP. This was accomplished by using the Variance Accounted Factor (VAF). In a similar fashion, WM acts as a mediator between the effect that FS has on EP.
Table 7. Path Analysis Path Model Direct Effect
(DE)
Indirect Effect (IE)
Total Effect (TE)
VAF (Variance Accounted
Factor) H6: Work
From Home
Work Motivation
Employee Performance
(WFH EP)
0.096
((WFH WM) x (WM
EP)) - 0.000789
(DE + IE)
0,095211
(IE:TE) x 100%
-0.83%
(0-20% :
No mediation) H7:
Followership Style Work Motivation
Employee Performance
0.585 0.119139 0.704139 16.95%
(0-20% :
No mediation) Source: PLS-SEM Research Data Processing Results (2022)
The results of hypothesis testing using the t-value and p-value are shown in Table 8. There are five direct relationships hypotheses (H1 to H5), as well as two path analysis hypotheses that involve mediator variables.
Table 8. Hypothesis Verification
Hypothesis Path
Coefficient
T-Value p-value Hypothesis Verification H1: Work From Home
has a positive effect on Employee Performance.
0,096 (9,6%) 1.672 (< 1.96)
0.095 (> 0.05)
Positive, not significant H1 is not supported H2 : Work From Home
has a negative effect on Work Motivation
-0,0003 (-0,03%)
0.043 (<1.96)
0.043 (> 0.05)
Negative, not significant
H2 is not supported H3: Followership Style
has a positive effect on Work Motivation.
0,453 (45,3%)
6.122 (> 1.96)
0.000 (< 0.05)
Positive and significant H3 is supported
H-4: Followership Style has a positive effect on Employee Performance.
0,585 (58,5%)
10.566 (>1.9)
0.000 (< 0.05)
Positive and significant H4 is supported
H-5: Work Motivation has a positive effect on Employee Performance
0,263 (26,3%)
4.262 (>1.9)
0.000 (< 0.05)
Positive and significant H5 is supported
H6: Work Motivation plays a role in
Variance Accounted Factor (VAF)
= - 0.83%
H6 is not supported
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Work From Home on Employee Performance.
(No Mediation)
H7: Work Motivation in mediating the effect of Followership Style on Employee Performance.
Variance Accounted Factor (VAF)
= 16.95%
(No Mediation )
H7 is not supported
Source: PLS-SEM Research Data Processing Results (2022)
Table 8 displays the result of hypothesis testing for both the direct influence hypothesis (H1 to H5) and the indirect influence hypothesis (H6 to H7). There were three proven hypotheses (H3, H4, and H5) and four unproven hypotheses (H1 and H2) among the seven hypotheses (H1, H2, H6, and H7).
3.2 Discussion
Discussion of each of the results of the seven hypotheses, as follows:
a. Work From Home and Employee Performance Correlation
Hypothesis 1 (H1): Work From Home has a positive effect on Employee Performance.
The path-coefficient of the effect of WFH on EP was 0.096 (9.6 percent), the t- value was 1.672 (1.96 percent), and the p-value was 0.095 (> 0.05). This implies that WFH has a positive but not statistically significant effect on EP. As a result, H1 is not supported. The coefficient value of 9.6 percent indicates that if the WFH rises by one unit, the EP rises by 9.6 percent as well.
The finding of this study backs up the finding of Rawat et al (2020) and Mardianah, Hidayat, and Hamidah (2020), who discovered a positive relationship between WFH and EP. The findings of this study, however, contradict the findings of Farooq and Sultana's (2021) study, which discovered a negative relationship between WFH and EP.
b. Work from Home and Work Motivation Correlation
Hypothesis 2 (H2): Work from Home has negative impact to Work Motivation.
The path coefficient of the effect of WFH on EP was -0.0003 (-0.03%), t-value 0.043 (< 1.96%), and p-value 0.043 (> 0.05). This means that WFH has a positive but not significant effect on WM. As a result, H2 is not supported. The coefficient value - 0.03% indicates that if WFH increases by one unit, then WP decreases by -0.03% from that unit.
The finding of this study contradict with Amsak and Indriati's (2021) study, which found that working from home has a positive effect on work motivation, However, this study backs up Farooq and Sultana (2021) which found a negative relationship between WFH and EP. Because EP and WM are both related to work, it is possible that WFH has a negative impact on WM.
c. Followership Style and Work Motivation Correlation
Hypothesis 3 (H3): Followership Style has positive impact to Work Motivation.
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The path coefficient of the effect of FS on WM was 0.453 (45.3 percent), the t- value was 6.122 (> 1.96 percent), and the p-value was 0.000 (< 0.05). This means FS has a positive and significant effect on WM. As a result, H3 is supported. The coefficient value of 45.3 percent means that if FS increases by one unit, WM increases by 45.3 percent.
The finding of this study back up the findings of Nejad and Naami's (2015) study, which shown a positive relationship between FS and WM.
d. Followership Style and Employee Performance Correlation
Hypothesis 4 (H4): Followership Style has positive impact to Employee Performance.
The path coefficient of the effect of FS on EP was 0.585 (58.5 percent), the t- value was 10,566 (> 1.96 percent), and the p-value was 0.000 (< 0.05). This indicates that FS has a positive and significant impact on EP. As a result, H4 is supported. The coefficient value of 58.5 percent indicates that when FS increases by one unit, EP increases by 58.5 percent.
The finding of this study back up the finding of Favara (2009) and Oyetunji's research, which shown a positive relationship between FS and EP.
e. Work Motivation and Employee Performance
Hypothesis 5 (H5): Work Motivation has positive impact to Employee Performance.
The coefficient of the effect of WM on EP was 0.263 (26.3 percent), t-value was 4.262 (> 1.96 percent), and the p-value was 0.000 (0.05). It means that WM has a significant and positive effect on EP. As a result, H5 is supported. The coefficient value of 26.3 percent means that if the FS increases by one unit, the EP increases by 26.3 percent.
f. Role of Work Motivation in mediating the Effect of Work from Home and Employee Performance
Hypothesis 6 (H6): Work Motivation mediating impact of Work from Home to Employee Performance.
The Variance Accounted Factor (VAF) was determined to be 0.83 percent negative based on the data. Given that the VAF rate is between 0 and 20 percent, the involvement of WM in mediating the impact of WFH and EP is no mediation (Hair et al., 2016).
The results of this study do not corroborate the conclusion of Amsak and Indriati's (2021) research, which showed that WM mediates the impact of WFH on EP. These researchers found that WM was responsible for the mediation of this relationship.
g. Role of Work Motivation in mediating the Effect of Followership Style and Employee Performance
Hypothesis 7 (H7): Work Motivation mediating impact of Followership Style to Employee Performance.
The Variance Accounted Factor (VAF) was found to be 16.95 percent when the investigation was completed. In light of the fact that the VAF rate falls somewhere between 0 and 20 percent, the function of WM in mediating the impact of FS and EP is no mediation (Hair et al., 2016).
The result of this study does not support the findings of Favara (2009), Oyetunji (2013), and Nejad & Naami (2015), which indicated that followership style has a direct influence on employee performance. These researchers found that followership style had a direct effect on employee performance.
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IV. Conclusion
This research shows that Work from Home boosts employee performance but not significant. Work from Home has an unfavourable and insignificant effect on Work Motivation. Followership Style has a significant and positive effect on Work Motivation.
Work Motivation affects employee performance. Work Motivation is not a mediator variable since VAF is below 20%.
This research also shows that PT. Sampang PSC, which acquired PT. Ophir and all of its staff, find that changes in working circumstances, such as Work from Home during the Covid-19 outbreak, and followership style affected their employee’s performance.
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